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Legislative News and Views - Rep. Dean Urdahl (R)

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Bill to lift unemployment insurance tax increase approved

Monday, May 2, 2022


ST. PAUL – Legislation to repay Minnesota’s unemployment insurance trust fund deficit and reverse tax hikes employers in the state faced despite a $10 billion surplus has been enacted into law.

Rep. Dean Urdahl, R-Acton Township, said he was pleased the House approved this bill (S.F. 2677), which provides $2.7 billion to fully repay the trust fund which was depleted with more people out of work during the pandemic.

“I am happy for our employers that we finally approved this bill,” Urdahl said. “They’ve been through a lot the last two years and did not deserve the delays House Democrats caused on this issue by adding unrelated measures to what should have been an easy bill to pass months ago with widespread backing.”

Senate Republicans approved a clean bill to rectify this issue in February, with broad, bipartisan support. House Democrats delayed action until late April, when they added more than $1 billion in other funding to the bill. Urdahl said this change complicated matters and delayed final approval, costing state taxpayers $50,000 in interest for every day the legislation languished.

Final language in the package includes $500 million in payments to frontline workers – approximately $750 per person – and $190 million is provided to Minnesota Management & Budget for continued COVID-19 expenses. Another measure allows just one legislative body to reject an expenditure instead of the current requirement for both bodies to object.

Approval of this package replenishes the unemployment insurance trust fund, uses the state’s remaining federal American Rescue Plan funding and halts automatic payroll tax increases that kick in by default when the trust fund dips beneath required levels. The bill was widely supported, with a 124-5 House vote and near-unanimous passage in the Senate on Friday before Gov. Tim Walz enacted it the same day.